UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

SERVED JULY 14, 1995

DHL Airways, Inc.       		|
					|
Violations of 49 U.S.C. 41708		|
and 14 CFR Part 241			|

CONSENT ORDER

The Department uses carriers' reports to monitor carrier fitness and ownership, to analyze the effects of air transportation industry policy initiatives, to allocate airport development funds, to forecast traffic, and to develop airport and airway traffic policy. A carrier's failure to file its reports prevents the Department from making fully informed decisions. Failure to file reports when they are due also constitutes a violation of both 49 U.S.C. 41708 and the Department's applicable regulations.

This is not the first time that DHL has failed to file reports as required. In mid-1993, DHL became seriously delinquent in filing reports. After missing several of its own self-imposed deadlines for the submission of late reports and after repeated warnings by the Department's Office of Airline Statistics (OAS) and Office of Aviation Enforcement and Proceedings (Enforcement Office), as well as the grant of two waivers by OAS from certain of the reporting requirements, DHL finally brought itself into compliance with the Department's reporting requirements in September 1994. Less than six months later, however, DHL again violated Part 241 by failing to file its required fourth quarter 1994 and first quarter 1995 Form 41 reports. As of June 21, 1995, DHL had failed to file 43 reports required by Part 241, with an average delinquency of more than 87 days. Moreover, most of the other reports that DHL has filed since September 1994 have been filed late.

In mitigation, DHL states that the statistical and financial reporting methodologies that DHL utilizes for its business purposes are incompatible with the reporting formats that the Department has mandated for its own purposes. Therefore, to comply with the DOT reporting formats requires in many cases manual bridging techniques and the exercise of judgment, which are not readily susceptible to being automated for computer operations.

DHL further points out that, with a special effort, it brought itself into full compliance with the Department's reporting requirements last September. According to DHL, however, four of the seven staff personnel who had worked on compliance reporting subsequently left the company, and the company's responsible director was on extended maternity leave from the office. While DHL actively recruited and began training replacement personnel, they were unable to keep all reports current. With the reporting staff now reestablished and becoming more proficient, DHL expects to return to full compliance by the end of July 1995, and to maintain that status thereafter.

The Enforcement Office has carefully considered the information provided by DHL but continues to believe that enforcement action is warranted. In this connection, the Enforcement Office and DHL have reached a settlement of this matter. DHL consents to the issuance of an order to cease and desist from future violations of 49 U.S.C. 41708 and Part 241 of the Department's regulations and to the assessment of $200,000 in compromise of potential civil penalties, due within 15 days of the issuance of this order. We believe that this compromise assessment is appropriate and serves the public interest. It represents an adequate deterrence to future noncompliance by DHL, as well as by other air carriers.

This order is issued under the authority contained in 49 CFR 1.57a and 14 CFR 385.22.

ACCORDINGLY,

1. Based on the above discussion, we approve this settlement and the provisions of this order as being in the public interest;

2. We find that DHL violated 14 CFR Part 241 by failing to file required reports in a timely manner;

3. We find that by engaging in the conduct and violations described in paragraph 2 above DHL also violated 49 U.S.C. 41708;

4. DHL is directed to file all of the delinquent reports described in this order by July 31, 1995;

5. DHL, and all other entities owned or controlled by or under common ownership with DHL, and their successors and assignees, are ordered to cease and desist from violations of 49 U.S.C. 41708 and Part 241 of the Department's regulations;

6. DHL is assessed $200,000 in compromise of civil penalties that might otherwise be assessed for the violations found in paragraphs 2 and 3 of this order, which amount is due within 15 days of the date of issuance of this order. Failure to pay the compromise assessment as ordered will subject DHL to the assessment of interest, penalty, and collection charges under the Debt Collection Act, and possible enforcement action for failure to comply with this order; and

7. Payment shall be made by wire transfer through the Federal Reserve Communications System, commonly known as "Fed Wire," to the account of the U.S. Treasury. The wire transfer shall be executed in accordance with the instructions contained in the Attachment to this order.

BY:

				ROSALIND A. KNAPP
				  Deputy General Counsel